1. The present appeals have been filed by the revenue under Section 35L of the Central Excise Act, 1944(for short 'the Act') against the judgment and final order dated April 4,2002 passed by Customs, Excise and Gold (Control) Tribunal, Eastern Bench, Kolkatta (for short 'the Tribunal') in final order No. A-507, 508/KOL/2002 dated 04.04.2002 in appeals No. E/R-312, 313 of 2001, wherein the Tribunal has allowed the assessee's appeals relying upon a judgment of the Tribunal in the case of M/s. Ammonia Supply Co. v. CCE, New Delhi 2001(45) RLT 271, in which the Tribunal has held that there was no packing/re-packing, labeling/relabeling or any other activity to make the product marketable.
Facts:
2. Respondent is a manufacturer of Acetylene, Oxygen amongst other gases and clears the same on payment of appropriate duty of excise. Helium is procured by the respondent from other manufacturers and sold under BOC brand name claimed as a part of its trading activity. Revenue issued a show cause notice alleging that since respondent had affixed label of their own name and other particulars, therefore, in terms of Note 10 of Chapter 28, the legal fiction of manufacture is created. The activity of affixing labels amounted to manufacture and called upon the respondent to explain as to why excise duty amounting to Rs. 7,39,910/- be not demanded/recovered and as to why a penalty should not be imposed. The period involved is March, 1997 to August 16, 1997.
3. The Joint Commissioner adjudicating the case confirmed the demand and imposed a penalty of rupees one lac on the firm and further penalty of rupees one lac on the Business Manager of the firm. On appeal filed by the respondent, Commissioner(Appeals) confirmed the order of the adjudicating authority. Thereafter the respondent filed an appeal before the Tribunal which has been accepted by the impugned order. It was held that the respondent was not involved in the manufacturing activity and in fact no manufacture was carried out by the respondent. Note 10 of Chapter 28 of the Central Excise Tariff reads:
...In relation to products of this Chapter, labeling or re-labeling of containers and re-packing from bulk packs to retail packs, or the adoption of any other treatment to render the product marketable to the consumer, shall amount to manufacture.
4. It is an admitted case of the parties that the respondent only labels or re-labels the product and does not pack or re-pack from bulk packs to retail packs in the present case.
5. In the case of Commissioner of Central Excise, Mumbai v. Johnson & Johnson Ltd. reported in 2005 (188) ELT 467(SC), a two Judge bench of this Court while interpreting Note 5 of Chapter 30 which is similar to Note 10 of Chapter 28 held that mere packing for marketing would not amount to manufacture. That mere labeling or re-labeling in the absence of any activity of repacking from bulk packs to retail packs would not render the product marketable directly to the consumer. It was observed in para 6 as under:
What has been overlooked by the appellant is that merely packing for being marketed would not do. The repacking would have to be from bulk packs to "retail packs" so as to render the product marketable directly to the consumer.
There is no evidence relied upon by the appellants to the effect that the cardboard boxes in which the units were placed or the thermocole containers were "retail packs".
6. We respectfully agree with the view taken by this court in the case of Jhonson & Jhonson Ltd. (supra) and following the same, dismiss the appeals leaving the parties to bear their own costs.